SPECIALIST

Property Finance

Best Rates & Fast Completions

Open 7 days a week

Bridging Loans by UK Property Finance

  • Master broker with market-leading rates
  • FCA-regulated 667602 and ICO (Data Protection) ZA115985
  • Access to numerous “special” products
  • Whole-market offering
  • Many years of relevant senior experience
  • Products covering all scenarios
  • Business/commercial bridging finance
  • Extended opening hours, 7 days per week
  • Investment development finance
  • Residential development finance

The 4-step bridging loan process

As one of the leading bridging finance brokers in the UK, our aim is to provide expert and quick bridging solutions without confusion. This means you get a simplified process when applying for urgent bridging finance matters.

Step 1: Indicative quotation

During an initial phone consultation, we will review your particular requirements, personal circumstances, and available solutions, and we will give free and unbiased advice to each of our prospective customers. We will email you the quotation, and if you are satisfied with the figures, we will proceed to step 2.

Step 2: DIP approval

It usually takes an hour or two to obtain a decision in principle; once approved, we will send you a detailed quotation and a copy of the terms.

Step 3: – Property valuation and application process

A valuation is instructed (if applicable), and your dedicated processor will obtain the necessary information from you in order to submit the application to the lender for underwriter review. Once approved by the underwriter, you will receive a full offer.

Step 4: – Completion

Also known as drawdown, once the loan has been completed, the funds are released.

  • Property auction finance
  • Buying a property and avoiding chains
  • Bridging loans for property development
  • Financing a self-build project
  • Bridging loans for land purchases
  • Probate and inheritance tax
  • Buying a residential property
  • Property refurbishment and renovation
  • Bridging finance for commercial use
  • Avoiding house repossession

Quick to arrange

Acquiring a significant sum of money can be a lengthy process, particularly when it involves business loans or mortgages for properties intended for rental, residential, or commercial purposes. However, when there’s an urgent need for funds, a bridging loan often proves to be the most suitable choice. If you possess sufficient equity in the property or properties being used as collateral, the funds you require can be deposited into your account within a mere 48 hours.

Very flexible

Unlike most other financial providers, bridging lenders are very flexible in terms of accommodating the needs of their clients. They are not overly concerned with a customer’s credit rating, whether or not they are self-employed or have a monthly income. Moreover, they are typically only interested in a viable exit strategy and the security you are offering. As long as you can pay the money back, even if things go wrong, your chances of approval are excellent.

Can be secured against any property type

A bridging lender will consider using any type of property or real estate as security, including residential property such as a house or flat, commercial properties such as offices, warehouse facilities, development land or building plots, and even farms or sports complexes. In addition, a bridging loan provider will also consider both freehold and leasehold property, even if the lease only has a short time remaining.

Loan repayments can be deferred

When taking out a bridging loan, people often wonder how soon or regular the repayments must be on your loan amount. Typically, the total loan is only to be returned at the conclusion of the agreement on the date agreed upon with the lender when you finalise your application. There are no payments due until this date, offering you peace of mind and extra money in the short term.

Properties in a state of neglect

This type of finance can also be secured against real estate that is in urgent need of repair or restoration. If a property is derelict or in poor condition, then most mortgage providers will deem it completely unacceptable for the purposes of securing a loan. This is another advantage when compared with other types of finance.

Unusual construction or non-standard properties

The vast majority of mortgage lenders will only consider offering finance secured against properties that are categorised as standard construction. Non-standard or unusual construction properties include buildings constructed from materials such as concrete, wood, corrugated iron, or steel frames, and these are often exceptionally difficult to obtain a mortgage on as they are considered less valuable than brick buildings with tiled roofs.

Multiple properties as security

Finance can easily be raised using two or more properties as security, either on a first- or second-charge basis or quite possibly using a combination of charges. Provided there is equity in the additional properties, a borrower can use that money to raise the funds required for another purchase or property development project.

Finance for business owners

Business funding can help with short-term and long-term cash flow problems, as having additional finance can make the daily running of your business easier to manage. Business funding can be used for a variety of purposes, such as helping to fund purchase orders or pay suppliers, paying off company tax and VAT, and purchasing new premises. The funds can be secured against the commercial premises or secured against future income or sales for repayment.

Bridge funding for a business can help with short-term and long-term cash flow problems, as having additional finance can make the daily running of your business easier to manage.

Business funding can be used for a variety of purposes, such as helping to fund purchase orders or pay suppliers, paying off company tax and VAT, and purchasing new premises. The funds can be secured against the commercial premises or secured against future income or sales for repayment.

More than 150 firms serve the loan industry in the United Kingdom, ranging from private family businesses to the country’s largest lenders and bridging financing organisations.

All of this adds up to a market in which fees, charges, and interest rates vary greatly between providers. As for the lending criteria, applicants must meet in order to qualify for a bridge loan in the first place. By working with the largest panel of lenders possible, we are a bridging company that provides our customers with the following:

Loan sizes

A bridge loan can be a uniquely flexible and cost-effective borrowing solution for covering urgent costs and funding time-critical investment opportunities. Loans can be issued up to around 85% LTV, secured against almost any type of property, and used for most legal purposes.

If all of the paperwork is in place, a rapid bridging loan can be issued in as little as a few working days. They have a maximum repayment duration of 12 to 18 months and a monthly interest rate of 0.55%.

Agreements are tailored to the borrower’s unique requirements, and a wide range of regulated and non-regulated products are offered.

Your broker will assist you in determining which of the two best meets your needs, as well as negotiate on your behalf to guarantee you obtain an amazing bargain from a top-rated bridge loan lender.

£50,000 to £1 billion*figurative sum: bridge loans are available up to any value whatsoever.

Term

Minimum 24 hours, maximum of 36 months

This type of secured loan is designed to be paid off in full in a very short amount of time. Most bridging lenders give loans for a maximum of 18 months; however, others may offer loans for up to 36 months.

FCA regulations limit regulated loans to a maximum of 12 months.

Security

Bridge lenders typically require collateral in the form of property. Loans can be secured on the value of one property for several combined properties. In the event that the loan is not returned as promised, the lender and borrower will enter into an agreement under which the service provider will assume possession of the property.

The loan is secured by the lender taking possession of the property, which is registered at the land registry as a first, second, or third charge.

Property types

The vast majority of property types can be considered collateral, including but not limited to:

  • Flats
  • Hotels
  • Bungalows
  • Guesthouses
  • Houses
  • Restaurants
  • Shops
  • Bars
  • Industrial units
  • Garages
  • Offices
  • Parking spaces
  • Mixed-use of properties
  • Holiday homes
  • Health clubs
  • Land

Typically, however, the very best deals in terms of interest rates and charges are those that are secured on residential property.

Other security

In some instances, service providers may offer finance secured against other personal possessions and assets, including cars and other vehicles, watches, jewellery, precious metals and stones, antiques, and artwork.

Get in touch if you require more information on alternative security for a bridging loan.

Property condition

While the condition and overall value of the property will be taken into account, many lenders are willing to accept property in need of restoration or in generally poor condition as collateral.

In fact, bridging loans have become something of an industry standard for developers looking to raise funds for property renovations and improvements.

Location

  • England
  • London + within M25
  • Scotland
  • Northern Ireland (limited facilities up to 50% LTV)
  • Wales
  • Also USA
  • Europe
  • Specialist low-cost plans available

Availability

Most bridging lenders open their products to businesses and individual borrowers. We specialise in finance for:

  • Private borrowers
  • Partnerships
  • Limited companies
  • Offshore companies

Age of applicant

All bridging companies impose a minimum applicant age of 18 years. While some lenders impose maximum age limits, others don’t. Unless there is a power of attorney in place, the applicant must be comprehensively aware of what they are applying for.

Credit history

Where collateral or security is required, credit history is inconsequential. This is why this type of finance can be particularly useful for:

  • CCJs
  • Bankruptcy
  • Defaults
  • Repossessions
  • Arrears
  • Statutory demands
  • IVAs
  • Winding up orders

Income evidence

The provision of sufficient collateral renders proof of income unimportant. As lenders do not collect staggered payments on a monthly basis, evidence of income is not required.

Interest payments

Unlike a traditional loan or mortgage, interest on a bridging loan is often applied to one single sum and paid in full when the loan is returned. However, some service providers allow borrowers to pay the needed interest on a monthly basis, although proof of income may be required.

Exit route (how a bridging loan is repaid)

There are various options for repayment, which include:

  • Property and asset sales
  • Refinance
  • Receipt of money owed
  • Policy on reaching maturity
  • Inheritance

Bridging finance: regulated vs. non-regulated loans

A bridge loan can be a uniquely flexible and cost-effective borrowing solution to cover urgent costs and fund time-critical investment opportunities. Loans can be issued for up to around 85% LTV, secured against almost any type of property and used for most legal purposes.

A rapid bridging loan can be provided in as little as a few working days if all of the paperwork is in order. It has a maximum period of 12 to 18 months and is normally paid at a monthly rate of 0.5% or less.

Agreements are tailored to the borrower’s specific needs, with a wide choice of regulated and non-regulated products available.

Your broker will assist you in determining which of the two best meets your needs, as well as negotiate on your behalf to guarantee you obtain an amazing bargain from a top-rated bridge loan lender.

Regulated bridging finance

A regulated bridging loan is issued when the applicant’s security for the facility is either currently used or intended to be used as a residential home by the borrower or a member of their family. These can be used for a majority of legal purposes, though they cannot be used as a second-charge loan with commercial applications in mind.

This is a useful facility for eligible borrowers looking to:

  • Buy a home or commercial property at auction.
  • Extend their buy-to-let property portfolio.
  • Conduct renovations or improvements on a property they own.
  • Raise capital for business purposes.
  • Escape the property chain when relocating.

Typical features of a regulated bridging loan include:

  • Available from £50,000 with no upper limit.
  • Can be secured against any type of property.
  • Fast completions (often a few working days).
  • Flexible loan terms of 1 to 18 months.
  • Competitive monthly interest and low borrowing costs.

Non-regulated bridging finance

Non-regulated bridging finance is issued when the security for the loan is not a property that the borrower or a member of their family resides in or intends to move into as their main home.

Non-regulated bridge loans can be used for almost any legal purpose and are not subject to the same restrictions as second-charge loans used for business or commercial applications.

This makes this kind of financing a useful option for commercial customers, business borrowers, and established investors who may be looking to expand their property portfolio.

The basic features are similar to those of regulated bridging finance, though often with greater flexibility regarding the types of assets that can be used as security for the loan.

Does a bridging loan affect your credit score?

Your credit score may be impacted if you have trouble repaying your bridging loan, which may make it more difficult for you to get a mortgage in the future. This is why, if you’re thinking about this kind of short-term financing, it’s crucial to receive counsel on bridging loans.

Does a bridging loan affect your mortgage?

Whether or not bridging loans have been fully repaid at the time of application may have an impact on mortgage applications. Mortgage applications may become more difficult as a result of outstanding bridge loans because of things like debt-to-income ratio, credit history, and borrowing capacity.

Do you need a good credit rating for a bridging loan?

Should your credit score be poor, the lender may view you as a higher-risk borrower and be less inclined to approve your loan application or provide you with less advantageous conditions. Some lenders will find this kind of information sufficient to reject the bridging, while others are pleased to supply the funding in any case.

Do I need a salary for a bridging loan?

Because bridging loans often include no monthly interest payments, proof of income is not required.

Can you get 100% bridging finance?

Using another property to offer additional security or making an undervalued purchase are the two main strategies to obtain a 100% bridging loan. It is best to offer additional security to the lender in order to obtain a 100% bridging loan. By reducing the risk for lenders, you can use the equity you have in other assets to protect a loan.

How are bridging loans paid back?

Since there is no set due date for this kind of loan, you can pay it back whenever you have the money. Lenders, however, typically anticipate that you will pay off the debt in a year. Longer repayment terms aren’t something that many give, though. A closed bridging loan has a predetermined date of payback.

For more information on any of the above or to discuss the benefits of bridging finance in more detail, contact a member of the team at UK Property Finance today.

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